I had this discussion about “Should Startups Take On Consulting Work?” with several entrepreneurs and most of us agreed we should be spending time building the product rather than doing consulting work.
When I meet up with investors, we talk about this topic too and You Can Only Do One Thing At A Time are the the words that I frequently hear from them. This is very natural because startups are small and have limited resources so it’s only right for us to stay focus and do what is usually known as the Unix philosophy – “Do One Thing and Do It Well“
Product to Service
I believe all entrepreneurs would love to just focus on building their products but your startup runs short of cash and you really need that cash to keep yourself alive, taking that client work might seems to be the right option. As long as the entrepreneur do not loses his/her focus. Once the cash-flow problem is solved, it’s time to start building again (hopefully, the entrepreneur does not fall in love with the easy money that comes from client servicing and forget about it’s product) Otherwise, it just turns from a product into a service company.
We are dying.
We bootstrapped Intraix. When we were doing up the low-cost Home Energy Monitoring System, some people thinks it’s a great idea but most thinks that it was crap. We were running low on cash and we had to keep ourselves alive. (it’s tough to survive, especially with Singapore high cost of living) So we had to do something otherwise it’s corporate world I’m coming back.
The Start of Bikeroger
Instead of taking up client work, we started Bikeroger – an online retail store for triathlon goods. (sounds good doesn’t it?, you can also call it a blogshop :D) Why retail and why sporting goods?
- Retailing is tough, I’m sure many of us agreed. But it is also the one with the simplest business model “buy low, sell high” and cash is collected the moment an item is sold. Unlike client work where the cash comes in only after the project is complete.
- Both Darrell and I love cycling. Cycling is also picking up among Singaporeans and we know some of the distributors and dealers around so it was easy for us to start selling on consignment. China is the world’s manufacturing arm so leveraging on our NOC Shanghai experiences and contacts, we started Bikeroger selling OEM Replica Jerseys
The struggle between Bikeroger and Intraix.
Sales were doing very well for Bikeroger, as more people got into cycling. We were selling more of the OEM Replica Jerseys. We slowly moved into other products like gloves and cycling lights but our main bulk of sales came from the jerseys. We make money, we could give ourselves allowance and the problem came. Just like any startups who moved into consulting work and forget about their product. What about Intraix?
We discussed, we talked, we fight and we decided had to split ourselves into different roles. Darrell would be focusing more on Intraix while I focus on Bikeroger. This way Bikeroger can continue to bring in cash-flow while Intraix can continue to figure it’s way out. Although we are doing different things, but we still have weekly meeting updating the status of both companies. But this cannot go on forever because Intraix is after all the main focus. So we set the target that once Intraix is able to keep us alive (with basic allowance), we would work less on Bikeroger.
(There is a very long story on this and I would love to share this in another post)
What’s next for Bikeroger?
As time passes, Bikeroger is making good money and Intraix is also slowly making progress. In the past three months, Intraix has pivoted into the commercial space and managed to secured 3 pilot testing site. I have also move back to Intraix, helping out in the operations and having more of a project management role.
Luckily, we have been doing a good job with Bikeroger and we have been receiving good attention from the public. So Bikeroger fans, we are now in the period transition which is why you see this now. Something interesting would be coming up very soon. We may have new team members joining us and things will get better, prettier and probably even cheaper.
So there you go people, this is why Bikeroger got started. We love the sport and we need the money.
What would you do if your startup is running out of cash? Would you take up any client work? And if the client work is making you good money would you drop off your product? Let me know what you think, love to discuss.
Photo Credit: toolstop